Current Market Value: CMA “Currently for Sale” Section

In addition to homes that have already been sold, a good CMA gives you information about other properties that are currently for sale. Even if properties don’t meet your criteria, they may be valid considerations for a CMA so that you can objectively evaluate whether the home you’re looking at is worth the asking price. Make sure you understand what the “Currently for Sale” section can tell you.  

Comparing your property to others on the market.

You don’t just want to compare your property to homes that have already sold; you also want to compare your dream property with other homes that are currently for sale. Maybe you’ll find out, from looking at a CMA, that your home is the only four bedroom/three bath home currently for sale, and only one has sold in the past year. That could mean that the home is atypical for the market, and if you need the extra bedroom, you might want to pay more for it.

Likewise, a CMA can tell you whether the asking price for your dream home is in line with other existing prices, and how long comparable homes have been on the market without selling.

Prices relative to earlier sales.

Comparing the “currently for sale” section to the completed sales gives you important information about trending sale prices. If the majority of the comparable homes on your CMA sold for $350,000 six months ago, but are listed for $320,000 now, home values may be falling. Likewise, an upward trend in asking prices means that property values may be rising, and you might just have to pay more for your dream home or look elsewhere.

Comparing price trends can’t tell you how home values are going to behave in the future, but they can give you an important understanding of the home you’re considering, and a basis for deciding whether or not the neighborhood offers the buying value you want or if you should look elsewhere to stretch your buying bucks.

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Steve SchraderBachar is a local mortgage planning expert who resides in Iowa and provides service to the clients of his mortgage planning practice across the Midwest.  You can reach Steve at 1-515-289-4381 or 515-360-5197.